Itxa/966/2008 Of The Commissioner Of Income Tax, Vi, Mumbai v. M/S Florina Fashion Pvt. Ltd

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION APPEAL NO. 966 OF 2008 INCOME TAXAPPEAL NO. 966 OF 2008 INCOME TAX The Commissioner of Income Tax. ... Appellant. V/s. M/s.Florina Fashion Pvt.Ltd. ... Respondent. Parag Vyas for the appellant. Sameer G. Dalal for the respondent. CORAM : DR.S.RADHAKRISHNAN and V.C.DAGA, JJ. CORAM : DR.S.RADHAKRISHNAN and V.C.DAGA, JJ. DATED : 6th October 2008. DATED : 6th October 2008. DATED : 6th October 2008. P.C. :---- P.C. : ---- . Heard learned counsel for the appellant and learned counsel for the respondent. 2. The above appeal seeks to raise following question of questions of law: Whether on the facts and in circumstances of the case the Tribunal was justified in law in deleting the penalty, which was rightly levied by the Assessing Officer u/s. 271(1)(c) of the Income Tax Act at 200% of the amount of tax sought to be evaded, even though the assessee failed to discharge its onus within the meaning of explanation (1) to section 271 of the Income Tax Act. 3. We have perused the order of the Income Tax Appellate Tribunal dated 13th November, 2007, specially, reasons recorded in paragraphs- 9, 10 and 11 thereof, which read as under: "9. Secondly, the additions which have been sustained by the CIT(A) are of such nature that the deductions and expenditure claimed by the assessee were not allowed by the lower authorities. It is a case of simple disallowance of various expenses. Such disallownaces, per se, do not make out a case of either concealment of income or furnishing of inaccurate particulars. IN fact there is no case of filing of inaccurate particulars. Here the case is that of non-accepting the genuineness of the particulars furnished by the assessee. The subtle difference between non-acceptance of genuineness of the particulars and furnishing of inaccurate particulars has to be looked into when a case of penalty is examined. 10. Any penalty should have an element of mens rea in it. This is because penalty is a penal proceeding resulting in a punishment. Therefore, the Revenue has to establish an element of mens rea against the assessee by showing that the claims of deductions made by the assessee were apparently for reducing the tax liability by concealing the income and particulars and details furnished by the assessee were false or necessary particulars and details were not furnished at all. Differences in view do not constitute a case of mens rea. 11. In short, we find this is a case of normal scrutiny assessment where the Assessing Authority has made certain additions, which were partially modified by the CIT(A). There is nothing beyond that. If every addition is a cause of action for imposing penalty, then any adverse adjustment made by the Assessing Authority in sec.143(3) assessment would invariably lead to levy of penalty. That is against the basic proposition of law that no penalty is automatic." 4. We do not find any case made out for admission of the above appeal. There is no substantial question of law involved in the appeal. Appeal is, therefore, dismissed.